Did GTA IV really cost 30% more per copy than Modern Warfare 2

Modern Warfare 2 has not only shattered all records for day one sales for a video game, it did it despite the furore over Activision’s price. Which turns out to be much cheaper than Grand Theft Auto IV.

Activision has just announced that Modern Warfare 2 has sold an estimated* 4.7 million units in the first 24 hours of being on sale. (I reckon that’s not quite true, given how many shops broke the street date, and probably means “in the first 24 hours that it was officially allowed to be sold”)

That generated $310 million in estimated* retail sales. And all of those figures only include North America and the UK, leaving out tens of millions of gamers in mainland Europe, Asia, Australasia and elsewhere.

But it seems that gamers were prepared to pay much more money for GTA.

Both titles apparently grossed the same amount on day one – $310 million. But Modern Warfare 2 has sold 30% more units than Grand Theft Auto IV, suggesting that GTA’s average selling price must have been 30% higher than MW2’s to generate the same revenue. The table below sets out the arithmetic.

Estimated retail sales

Estimated units sold

Average selling price

($m)

(m)

($)

Modern Warfare 2

310

4.7

$65.96

Grand Theft Auto IV

310

3.6

$86.11

Assuming that both companies’ press releases and estimates were correct, it’s a pretty surprising result.

The game that was reviled for pushing up the price of a game to unprecedented levels actually cost gamers significantly less than last year’s hit title.

Amazon.com is selling Modern Warfare 2 for $59.99. As is GameStop. Best Buy is selling for $49.99. (And for all those people who complain about Rip-Off Britain, £29.99 is approximately $49.83 at current exchange rates).

The higher ASP is probably due to Prestige editions (the one’s with night vision goggles, which retails for somewhere over $200) or Hardened editions, which Amazon is retailing at $79.99.

It sure shows little control publishers have on what consumers actually pay.

Of course, that may not matter: Activision probably increased the RRP in order to increase the amount it charges retailers for a copy. If retailers want to reduce the selling price to encourage footfall or stay competitive, that is their choice, but they are doing it at the expense of their own margins, rather than Activision’s

But (assuming Take Two’s numbers are accurate) did GTA IV really achieve an Average Selling Price of $86.11? That’s a hell of an achievement if it’s true.

* Activision has been very careful to make sure that it is clear that these sell-through figures are estimates, repeating the word three times in its short press release

About Nicholas Lovell

Nicholas is the founder of Gamesbrief, a blog dedicated to the business of games. It aims to be informative, authoritative and above all helpful to developers grappling with business strategy. He is the author of a growing list of books about making money in the games industry and other digital media, including How to Publish a Game and Design Rules for Free-to-Play Games, and Penguin-published title The Curve: thecurveonline.com

One way of thinking about is the special editions/premium versions. I suspect that those skew heavily to early adopters. So if premium editions are 2x the price, that might explain it.

I don't have any evidence about what percentage of first week sales are premium editions however.

The other odd thing is that I am just taking official announcement data (units sold and $ value). The data is as solid as any piece of PR is, and the average selling price just falls out of the bottom.

ChrisBateman

Something is amiss here… I believe the US retail price for GTAIV was $45, and most of the stores would have discounted this further. Of course, in the UK they sold “dollars for pounds” so the £45 retail price would be about $72… But nothing I can see right now would push average retail anywhere near $86 per unit.

One way of thinking about is the special editions/premium versions. I suspect that those skew heavily to early adopters. So if premium editions are 2x the price, that might explain it.

I don't have any evidence about what percentage of first week sales are premium editions however.

The other odd thing is that I am just taking official announcement data (units sold and $ value). The data is as solid as any piece of PR is, and the average selling price just falls out of the bottom.

ChrisBateman

Something is amiss here… I believe the US retail price for GTAIV was $45, and most of the stores would have discounted this further. Of course, in the UK they sold “dollars for pounds” so the £45 retail price would be about $72… But nothing I can see right now would push average retail anywhere near $86 per unit.

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